Weekly Economic Update 8/15/2016

Weekly Economic Update 8/15/2016

RETAIL SALES WEAKEN

July was the first month since March without a gain in U.S. retail purchases. The Census Bureau’s latest report showed retail sales were flat last month, a disappointment in the wake of June’s 0.8% climb. Car and truck sales advanced 1.1% during July, but, minus auto buying, retail sales were actually down 0.3% for the month.1

HOUSEHOLD SENTIMENT INDEX IMPROVES

The University of Michigan’s monthly consumer sentiment index rose to 90.4 last week in its preliminary August edition. It had ended July at a mark of 90.0. A consensus forecast of economists at Briefing.com had projected a 90.2 reading.1,2  

WHOLESALE INFLATION RETREATS

The federal government’s Producer Price Index moved 0.4% lower in July as declining energy costs lessened inflation pressure. The core PPI fell 0.3%. In June, the headline PPI rose 0.5%; the core PPI, 0.4%.1,2

OIL RALLIES, NASDAQ CLOSES AT RECORD HIGH

August 8-12 was oil’s best week since early April: WTI crude settled at $44.67 on the NYMEX Friday after futures ascended 6.4% in five days. A 0.23% weekly gain led the Nasdaq Composite to a record close of 5,232.89 Friday. History was also made Thursday when the Nasdaq, S&P 500, and Dow Jones Industrial Average each settled at all-time highs – the first time that had happened since 1999. The Dow advanced 0.18% for the week; the S&P, 0.05%. The Dow settled Friday at 18,576.47; the S&P, at 2,184.05.1,3

THIS WEEK: Sysco announces earnings on Monday. On Tuesday, the July CPI arrives, plus reports on July building permits, groundbreaking and industrial output, and earnings from Advance Auto Parts, Cree, Dick’s Sporting Goods, Home Depot, Popeye’s, TJX Companies, and Urban Outfitters. Wednesday, Wall Street considers the minutes from the July Federal Reserve policy meeting and earnings announcements from Agilent, American Eagle Outfitters, Analog Devices, Cisco, L Brands, Lowe’s, NetApp, NetEase, Staples, and Target. A new initial claims report appears Thursday, along with the Conference Board’s latest leading indicators index, and earnings from America’s Car-Mart, Bon-Ton Stores, Gap, Hormel Foods, Perry Ellis, Ross Stores, Stage Stores, Toro, and Walmart. On Friday, Deere & Co., Estee Lauder, Foot Locker, Stein Mart, and Tuesday Morning present earnings.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +6.61 +6.75 +12.97 +6.75
NASDAQ +4.50 +3.74 +21.73 +15.43
S&P 500 +6.85 +4.70 +17.06 +7.24
REAL YIELD 8/12 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.07% 0.58% 0.06% 2.33%

Sources: wsj.com, bigcharts.com, treasury.gov – 8/12/163,4,5,6

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

WEEKLY QUOTE

“Chance favors the prepared mind.”  

– Louis Pasteur

WEEKLY TIP

When a single parent is ill or injured and cannot work, a family can face a major financial crisis. Single parents should consider disability insurance in light of that risk.  

WEEKLY RIDDLE

Three women leave work with only one umbrella to share between them. They all try to fit under the one umbrella as they walk to a cafe. When they reach the cafe, none of them are the least bit wet. Why?

Last week’s riddle:

What three letters can you use to spell out a word meaning “enemy?”

Last week’s answer:

F, O, E.

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Citations.

1 – thestreet.com/story/13674220/1/stocks-close-mixed-as-crude-enjoys-best-weekly-gain-since-april.html [8/12/16]

2 – briefing.com/investor/calendars/economic/2016/08/08-12 [8/12/16]

3 – markets.wsj.com/us [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

4 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

5 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [8/12/16]

6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [8/12/16]

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